I have just begun buying a couple properties in Cleveland for rental income. Any suggestions or advice on investing in this area as I am out of state in California? Hard to get renters? What areas are good and developing? Are any other people doing well buying in Cleveland? Thanks.
why cleveland maple?
I have been told by people I know successful in investing that this is one of a bunch of cities that are currently good places to invent and make rental income.
just looked the city data. the popluation is declining and the Rental vacancy rate is high, 14.8% I guess that’s why the house is so cheap there, here is a few data:
year popluation
1890 261,353 10
1900 381,768 7
1910 560,663 9
1920 796,841 5
1930 900,429 6
1940 878,336 6
1950 914,808 7
1960 876,050 8
1970 750,903 10
1980 573,822 18
1990 505,616 23
2000 478,403 33
2005 412,XXX
maple,
i’m not saying to invest or not invest in cleveland.
what i will say is that if you’re going to captain your own ship, so to speak, through the DEEP waters of real estate investing, or any investing for that matter - YOU MUST NOT PAY ATTENTION TO WHAT PEOPLE TELL YOU, but rather, listen to what people say and VERIFY EVERYTHING.
what’s the saying? TRUST, BUT VERIFY.
Thanks, it may seem like a bad time since population keeps declining, but I also intepret as a good time. Cleveland seems to be in a lot of development and revitalization and my hope is they are at a low point…I can only hope!
Maple:
Since its unlikely that everyone will move out of Cleveland and the population will drop to zero don’t be too concerned with macro stats. On the other hand trying to pick a top or bottom is next to impossible. Why not put your focus on the house itself? I’ve done deals in Cleveland, Dayton, Columbus, Zanesville etc… Had I went by a declining population all those deals would have been done by someone else.
Your looking for cash flow. Keep that your focus.
Maple
I bought a Double in Lakewood its actually the outskirts of Cleveland. I lived in the upper while rehabbing it and renting the lower. This actually covered my Mortgage on a 130,000 house. 30yr va @5.25%. When I moved to Florida I rented the upper. Here is what I know, it was risky for me just as the stats showed. However in Lakewood it is a huge rental area. Its mostly all doubles. Alot of absentee landlords. My friend told me that when he moved back home in 1998 you couldnt find a house for sale and now they are for sale everywhere. I did it and its working for me right now. Ive had it for a year and a half. Great community there! Since I lived there and almost retired there and was looking hard at other areas to invest in, I found an area very close to the city, where a ton of rehab was taking place. I found homes on either end of a street going for 170 -200,000 and homes right in the middle of the street going for 80,000 with recently renovated homes right next to them. These homes were obviously in a one time run down section of town however the community was getting better as Cleveland expanded to this yuppie neighborhood if you will. This area was called Ohio City. Call me crazy however I will tell you that this area is real close to the sections of the city where they take old wharehoses and make them into upscale retraunts etc. That area is called the Flats. It seemed as if a lot of money was starting to go that direction. For instance the Great Lakes Brewing company opened a very respectable restraunt just a few blocks away. Johnny Mango’s, Kimo sushi, The garage etc etc etc Condo,s all going up within walking distance from this area. Public transportation huge! a train ride for $1.50 takes you to any stadium the Downtown mall where a christmas story was filmed,the Hard rock Cafe, House of blues, the Rock and Roll hall of fame, the Indians the Browns and on and on. I know alot of work probably would have had to go in into these homes but I kept seeing signs at rehabs that were from investor groups. I probably should have went with my gut when I was there but inexperience to what I was doing and the fact that I was up to transfer kept me from doing anything. As you probably guessed I believed in that city and the locals there do as well. These are just my observations and I may be completey off my rocker but just google up OHIO City in Cleveland as well as the Flats and Lakewood and see what you think. Just my thoughts rambling on I really hope to move forward and retire here in Florida. I am sure once I am here longer I will feel the same about this locale anyway the weather is better I just hope the real estate market will serve me well!
and allow me to retire here from the Navy.
Scott
Right now Cleveland is undergoing a huge revitalization and anyone living their or visiting the city can tell you that. The population figures are very skewed and can be misinterpreted if you’re not familiar with the city.
In the city of Cleveland the population has been dropping for the past 50 years, but take almost any other smaller urban city and the figures will be the same. However the general population in Cleveland is not shrinking, instead more and more people are moving to the suburbs on the east or west side.
I personally cannot give you advice on investing in the city because the majority of my business is from flipping. I know you can find cheap homes, and definite tenants but generally speaking it would not be a great place to flip. Also be aware that the Cleveland Public school system is in terrible condition so that will affect any resale value.
Don’t be discouraged, you just need to find the right area in Cleveland and the right property. It is a great city to invest in and there are endless amounts of opportunities.
I lived in lakewood for 2 years and rented the downstairs unit of a double. I have nothing good to say besides the close proximity of local watering holes. The houses are old and typically expensive to heat. The taxes are the highest in the county and the rents are trending downward from too much supply. Purchase prices skyrocketed in the past few years because new owners could afford more of a house with the rental income. My advice, if you’re looking for any kind of cash flow, stay out of lakewood. I learned the basics and bought a double 2 miles closer to the city. Taxes are half the amount, rents are the same, if not more, purchase price was lower…cash flow much better (positive).
With all of the foreclosures hitting the market, now is a great time to buy undervalue and hold with rental income. I convinced my girlfriend to quit renting and we found a HUD home needing only paint and a roof. Needless to say, she closed at 60% to market value. I also have my eyes on another foreclosure property listed for around $55k in the same neighborhood with comps in the low $100’s. I love the economics of this area.
I hope this helps…if you’d like more details on specific areas, let me know as i’ve done my fair share of research.